Bitcoin climbs to $10k | Hacker News Reader

Bitcoin climbs to $10k

bloomberg.com

90 pointspseudolus100 comments

I lament the recurring fact that “the price” dictates more than anything else when and even if a news article appears in a mainstream news medium like Bloomberg.

There is soo much technical development in bitcoin that is way more news-worthy than what the market happens to be doing today ️

Price is an advertising mechanism, though I do agree with your sentiment.

Agreed.

Which ones fascinate you the most?

What else is there? Bitcoin is an investment, so this is important in the same way that the price of gold climbing like this would be important.

Bitcoin is meant to be a way of completing payments, not an investment. The use as an investment goes against its primary purpose.

Who cares what it's "meant" to be?

You must be pretty behind the times. Most shops have stopped accepting bitcoin because of volatility and high transaction fees. Bitcoin thrives as virtual gold precisely because those two downsides make it useless as a currency.

That's the primary reason the Bitcoin Core / Bitcoin Cash split 2 years ago now was a difference in opinion about whether or not usage as a payment method mattered. Now you have two competing camps one is pushing the Bitcoin as egold and high fees while the other is pushing Bitcoin as a means of exchange with low fees.

The volatility was solved by the payment processors. In any case the big payment processors support both now. The higher than credit card fees though did kill the use of Bitcoin Core as a payment method in ordinary transactions.

Bitcoin was invented as a way to protect individuals from governments devaluing fiat currency. Payments have always been secondary to this goal. Read Satoshi's white paper.

> Bitcoin is an investment

Bitcoin fails every imaginable property of investment vehicles.

we don't really need to have the same discussion ad nauseam . People invest in bitcoin so it must be an investment

People buying Bitcoin aren’t investing just because they think they are.

> ad nauseam

Exactly.

Every cryptocurrency discussion is an Eternal September [0] that recycles the same, tired, 10-year-old arguments.

Pretty soon some smart guy will pop up to educate us on the Dutch tulip mania of 1637, how Bitcoin isn't "backed" by anything, or how the US dollar is "backed" by taxes and the military.

[0] https://en.wikipedia.org/wiki/Eternal_September

what i hate is that bloomberg is mainstream news now. They re a financial website.

As someone who’s been in the field since 2012 - yes, the tech part is what’s the most interesting. I explained to countless people that price is not what matters the most.

Having said that, I’ll shamefully admit that when the prices go up I get happy and excited :) We’re all humans after all!

That's like saying you read Playboy because of articles. Price is the single most important metric of Bitcoin's success. Price determines whether Bitcoin will (or how close Bitcoin is to) overtaking Gold and fiat in becoming the world's reserve asset and freeing people from wealth confiscation via hidden inflation tax.

I suppose it depends on what we mean by newsworthy. To anyone who owns (or doesn't anymore, or thought about it and..) bitcoin, price is what they care about. It's a little dull as news though, since all there it is a number, with all following words redundant.

The tech is perhaps the interesting part, since it evolves and has depth.

From my pov, neither are the most important part. Usage is what actually matters. That's both hardest to report on and perhaps most disappointing.. at least for bitcoin as a currency.

What technical development are you speaking of? I thought the Bitcoin community didn't want any modifications to Bitcoin.

It doesn't even scale enough for mass adoption. Who said it shouldn't have any modifications?

Not me. I am trying to understand which developments the author of the parent comment is talking about.

Probably Lightning Network.

There are some nice updates in Lightning Network, e.g. I just saw that Lightning Labs released beta of a “non-custodial” mobile wallet that with good UX internally runs Lightning node on the phone: https://blog.lightning.engineering/announcement/2019/06/19/m...

I think the UX is still far from great, but it’s slowly getting there.

Why would you think such a blatantly false thing? Some recent developments include:

- Schnorr Signatures https://github.com/sipa/bips/blob/bip-schnorr/bip-schnorr.me...

- Taproot https://github.com/sipa/bips/blob/bip-schnorr/bip-taproot.me...

- Erlay (relay protocol that reduces bandwidth up to 75%) https://arxiv.org/abs/1905.10518

- Dandelion (privacy enhancing transaction relay protocol) https://github.com/bitcoin/bitcoin/pull/13947

- Miniscript https://prezi.com/view/KH7AXjnse7glXNoqCxPH/

and many more

The central banks of the Eurozone, Switzerland, Sweden, and Japan have set negative short-term interest rates, and in the U.S., the president has threatened to demote the chairman of the central bank if he does not cut interest rates. This may explain increased interest in alternative currencies.

This right here is I think the best argument.

Cryptocurrencies are going to be an escape to tumbling economies in the next 2 years. It does not matter if gold or other instrument is better, crypto is super accessible now, and is what people will use.

Having lived in different countries in Europe and the Americas, Ive experienced first hand the difficulty in "buying gold". Not only that, even when buying any instrument, usually it means trusting in some 3rd party to manage it. While using a crypto wallet means only you have the private key.

And yet there is no inflation. So the currency debasement yielding to hyperinflation argument which has been running since 2008 remains without any evidence.

There is inflation, it shows itself in asset prices. You are also skipping a step, the currency debasement and resulting loss of global reserve status leads to hyperinflation.

That was what I checked today, because ECB was supposed to rise interest rates around June/July. So it will not happen and I just got emails about my savings account going to lower their rates. For now I am good with not having negative rates but it is going to increase housing bubble we have now. So new crypto bubble is IMO in the same boat with housing.

I'm still not sure what to think about cryptocurrency[0]. I just don't get the price fluctuations. They seem to be random and not based on any relevant real-world event. Granted, they list the announcement of Libra as a reason in the article, but how would that be good for Bitcoin?

[0]and that's coming from someone who owned several bitcoins a few years back but stupidly used them for buying stuff. It's not as bad as the guy who ordered a pizza for I think 1 million bucks, but still I'd rather have the money now...

There have been quite a few stories about how many people in Venezuela have been using it to escape the devastation of their currency. So there might be some price-affecting demand there.

This was mentioned during the last spike and used to provide justification to crypto. In reality no one there was using it for this as they couldn't even wire their cash out of the country and into the exchange

Everyone thinks that everyone else thinks that Libra is positive news and will buy more bitcoin. Then when everyone sees these news articles on top of their feeds, they will get FOMO, and everything becomes a self fulfilling prophecy. Fundamentals dont matter.

Scarcity has a lot to do with it, which is fundamental.

> but how would that be good for Bitcoin?

It generates hype for cryptocurrencies generally and bitcoin is the most well known of those.

I mean long term Libra is a potential competitor (if it ever gets that far, I have my doubts).

That said I've maintained crypto is insane from the start, the technology is interesting but it seems like a classic solution looking for a problem (and it suffers from the "if it is better, is it so much better to overcome inertia).

Sounds like you understand the fluctuations as well as the rest of us. Still it's a fun ride

The people gaming the system to increase its "value" have slowly brought the price up - and they will keep working together (indirectly and directly) to convince/manipulate/trick consumers into buying into this global, decentralized Ponzi-Pyramid scheme to further their wealth through unreasonably redistributing wealth towards earlier adopters - while increasing the "army of HODLers" who now have vested interested in pushing these crypto-"currencies." Everyone who's lost money to the earlier adopters are heavily incentivized to talk positively and promote them so they can attempt to at minimum break even from their losses - which is the main mechanism as to why these are so dangerous for society, the incentive and alignment of working together - to adopt something that has shown little to no value to society; blockchain is a separate conversation as to its value for society. The "killer app" that no one seems to have been able to create for society yet seems to actually be that its structure allows for a Pyramid-Ponzi scheme - and the people selling the shovels during this modern gold rush seem to be the ones best capitalizing on the hype and frenzy.

Are you against any asset where visionaries got in early? VCs and wealthy investors reap the vast majority of rewards when companies like Uber go public, and let the retail investors hold the bag. I don’t see much of a moral difference.

Uber is a company that provides a highly useful service. Bitcoin is just a decentralized long con.

You can make an argument against the asset itself and it’s utility. But parent was arguing that the fact early adopters captured a majority of the gains makes Bitcoin evil doesn’t make sense to me. I’m happy that crypto nerds won this time over the usual suspects of VCs, family funds, etc.

What value has Bitcoin et al brought anyone other than earning them "profit" because they were earlier in the Pyramid-Ponzi scheme - or at a low point before price went up and sold before the bubble(s) popped?

This ponzi has better rules than the ponzi your government created for you by default. It is as simple as that.

Very easy to argue that's not the case.

Ok, I'm not a huge fan of the crypto craze, but ignoring providing a solution to the problem of trust in decentralized networks and implementing a working payment network on top of that is just a blatant ignorance.

The solution is massively unelegant and unlikely to be worth so much long-term as markets are predicting now, but it definitely does provide some tangible value and it's pretty stupid to imply otherwise.

Simply asking for what value has Bitcoin et al provided isn't the same as a statement that states it doesn't cover some areas of value, however pros existing doesn't necessarily negate the cons - doesn't mean there's a net benefit to them existing. Ignoring that a solution for 'trust in decentralized networks' can't be solved in other ways, like normal real-life trust networks, where people make a decision of who they trust for this vs. having "blind trust" is in fact blatant ignorance.

Albeit Uber is overvalued for the service they provide, and their play is one of the VC industrial complex to ramp up to high value as quickly as possible in the eyes of the financial markets (large money pool controllers) to get on stock market at unreasonable valuation, exit some early investors/founders and provide a fun lifestyle for themselves during the process - offloading risk to general public, society via the IPO etc.

I'm not sure if you're purposefully trying to conflate legitimate stock market companies with the likes of Bernard Madoff Ponzi Scheme et al?

And are you trying to argue the VC industrial complex is the best and/or only method of developing large, useful organizations who develop products and services?

It also helps when you can print "Tether" out of thin air to manipulate the price until the media notices and you can get grandma and grandpa pulled into the scam.

To be fair Tether is basically just mirroring the US treasury

New currencies always fluctuate very much when they start because no one knows what the value is. Most of the time this will settle after some time (years) because then the market decided it's value.

I even think there are countries where the currency fluctuates more than Bitcoin.

Crypto busted last year and that took a lot of people out of the system including the secondary coins (which was the main driver of bitcoin prices as people mined newer coins and exchanged them into btc). Btc is rising simply because it's the last man standing (sort of).

> They seem to be random and not based on any relevant real-world event

There are some events that trigger movement, but in macro it just looks like a very regular pattern of bubbles interspersed with long periods of not much movement. Even now I think there are enough ideological and greedy fools that I think the bubble pattern will remain strong that even a dispassionate amateur can reliably make a profit.

It started to show signs of a strong upward trend a month ago. Now that mainstream news is covering it I'm confident it will start to grow faster into a very obvious bubble.

the important thing is that the ledger works. Coins are like gems in the middle ages: some people would price them at $1000 some others at $1. Without mass adoption the discussion about price and its fluctuations is not meaningful.

> Libra as a reason in the article, but how would that be good for Bitcoin?

There are many ways, e.g. bitcoin holders may exchange for libras to cash out.

Bitcoin is a very good store of wealth when compared to, say, gold. If I was in a country like Turkey or China I would be moving my wealth into it any way I could. The government inflates their currencies and locks or seizes bank accounts. When you want to escape the dictator, you can memorize 24 words and take your wealth with you over the border. Very hard to keep your gold safe from guards.

Ignoring all of the other uses of Bitcoin, the “digital gold” argument is the strongest IMO.

Bitcoin's value is incredibly volatile. That's not a good attribute for a store of wealth.

Even loosing 90% is better than loosing everything to war, dictatorship, police.

But having gold or offshore dollar bank accounts is better than losing 90%...

Ahhh yes, because rose are so easy to come by and to setup

I can assure you a lot more people in countries with broken payment systems have managed to acquire gold and/or US bank accounts than to transfer their local currency into Bitcoins...

You can't compare the penetration of Bitcoin (10 years) to Gold (1,000+ years) yet but adoption trends point in bitcoins favor.

Do adoption trends really point in bitcoin's favor? Central banks have been buying 10s of billions of dollars worth of gold every year.

The worst case for BTC is not -90%. It has very little fundamental utility underpinning its value, and nowhere near the faith in its value that gold has built up over millennia.

How is it better than gold? The primary goal with a store of wealth is price stability, and gold is way more stable than BTC. BTC is certainly better than many fiats but it’s still highly unstable. Most people who are buying it are buying it as an investment, not a store of wealth.

I think the commenter is suggesting that sometimes the mobility of your store of wealth is more important than volatility. Hard to argue that gold is easy to move or store. People from the US and Western Europe are prone to forget how volatile the political and economic situation is for most of Earth's population.

People who use gold as a money store don’t buy physical gold, though. They buy insured, gold backed securities which are held in a stable location, usually the United Kingdom. The account that holds those securities is protected by a password, just like Bitcoin

I think that those that believe in Bitcoin as a store of wealth, believe that its volatility is temporary. The assumption (or hope) is that its taking a volatile path upwards and will eventually, like gold, reach relative stability at a much higher price than what it is currently.

Couldn't it be argued that Bitcoin's volatility is a temporary

Ignoring the volatility of Bitcoins, if you can convert your wealth into Bitcoins why not just move it outside of the country using the same mechanism?

The argument you're making is a strong argument for cryptocurrency, but not for Bitcoin specifically. Ethereum, Litecoin, Peercoin, Dogecoin, and a wide variety of other cryptocurrencies have the same properties you're describing.

Bitcoin isn't the most advanced cryptocurrency out there. It doesn't have even close to the best technology. Bitcoin's continued dominance is very strong evidence that it's completely popularity, not technology, that drives prices. There are numerous other examples: Peercoin, for example, pioneered a new proof algorithm, but peaked at $10 and is now at $0.38; superior technology doesn't guarantee success. This means that it's entirely possible for another cryptocurrency to surpass Bitcoin, but the technology isn't the driving factor.

With gold, there are industrial uses which drive the price up or down, and you can't just substitute platinum or silver for those industrial uses. You can substitute platinum or silver for gold as an investment, but the laws of physics limit the number of precious metals that can stably exist, so gold is competing with a limited number of precious metals as an investment. Not so for Bitcoin: I can spin up a competing blockchain this afternoon if I want, and there's no limit to the number of competing cryptocurrencies.

What I'm saying is that I think that speaking of Bitcoin as "digital gold" breaks down pretty fast once you analyze it at all.

The key property of using gold as a store of value besides it being easily divisible, hard to counterfeit, etc is that there's plenty of other people in the world willing to accept it. Popularity isn't an arbitrary property, it's a feature

That's a circular argument. People accept it because it's valuable, it's valuable because people accept it?

It’s weirdly circular, but it’s also correct. This is how many things with network effects work. Something is useful because others use it, which makes it more useful, which makes more people use it...

In this case, you could also look up “coordinated Nash Equilibrium”, which can partially explain some of the behavior in bitcoin.

> It’s weirdly circular, but it’s also correct. This is how many things with network effects work. Something is useful because others use it, which makes it more useful, which makes more people use it...

This can work for a little while, but without other factors to maintain the cycle it's just a fad.

> In this case, you could also look up “coordinated Nash Equilibrium”, which can partially explain some of the behavior in bitcoin.

You could also explain how coordinated Nash equilibrium relates to your point, instead of name-dropping complex topics (which you may not even understand). If you actually have a valid point here, you can explain it rather than expecting others to do your research for you.

The second half of that headline is a loaded statement that does not belong in proper journalism.

At least, the authors gave away their bias from the get-go.

Journalists do not only report the news, nor should they limit themselves to that. They also explain, classify and arrange the news, and put them into a broader context. This is the more interesting, the more difficult and more valuable part of their job.

Sure, you don't want to read this viewpoint. Great! There are thousands of cryptocurrency web sites with "proper" news and commentary for you to read.

This article is for people like me.

Once you provide interpretation, you are picking and choosing. That's an easy vehicle for manipulation of public opinion, and is exactly why so many people lament the current state of journalism (not that the past was any brighter).

People lament the current state of journalism, because they feel "their journalists" aren't reputable, but the reputable ones aren't "their journalists".

There are journalists all across the political spectrum, from the extreme left to the extreme right. But everybody wants to see his opinion enshrined as "mainstream" by the New York Times or the Washington Post.

On the one hand, they place enormous value in those papers and their reputation, but on the other hand these papers only sell worthless manipulation. Something doesn't compute here.

I didn't say I don't want to read it. I said, the authors gave away their bias from the get-go.

Their opinion still might be valuable.

But why would Libra increase rather than decrease interest in Bitcoin? Is there any actual rationale?

Because Libra is going to attract more people into the crypto industry and it doesn't compete with Bitcoin but rather complement it.

I don't think it is linked to Libra. The price if Bitcoin has been slowly rising for a while now.

During the last 3 months, when my stocks are red, Bitcoin is green.

Libra is better than the dollar but still not as censorship-resistant as Bitcoin.

Regulation in Libra will eventually push people to Bitcoin, or atleast that is the expectation.

Bitcoin doubled in price in a month, before Libra was announced.

Libra has nothing to do with the current rise.

But because the media works the way it does, Libra will be used as an excuse to lure people in and thus ending up actually affecting the price

Long term libra will be bad for bitcoin if it actually catches on imo

Everybody probably has their own opinion on this but it doesn't seem like Libra is in competition with Bitcoin (since it doesn't seem like payments is what keeps BTC going), but legitimizes the idea of crypto-currencies in general.

No, but I always find funny that geeks are so excited about the technology behind bitcoin but at the same time remain largely clueless about what currencies are, why so they exist, what is the role of a central bank, how currency adoption works, etc.

I'm not saying it's the reason for the current situation, but I can see Libra in the near future giving some credibility to the concept of crypto in general. What could get something out of the fringe faster than Facebook's endorsement?

Has broken $11k right now.

It will pass $25,000 before the halvening in May 2020.

Increased equipment cost, same electricity cost but half the rewards = a large value shift.

Why 25? What makes you throw this exact number? Wild guess?

25,000 if we are talking about significant digits is not very precise. Also, I interpret the 5 to mean between 20 and 30k.

ancient art of albitcoiny

Many factors are working together to cause cycles around halvening points which result in price spikes.

Price action will inevitably cause a FOMO cycle again... when the economy goes south in the next 0-2 years, the liquid/scarce safe haven will be very clear.

The last peak and ATH is $20k; $25k is too low, the next peak might be $50k.

He's not talking about the peak. He mentioned it's at the halving date. Price usually doesn't peak for months after that.

Why would that not already be factored into the current price, especially given how established Bitcoin is by now?

The price discovery period doesn't end until all potential participants have entered the market and all coins have been mined.

Can you explain this a little more? I’ve always wondered about this question.

price discovery is the process of moving the price until you encounter more market resistance than you can handle in both directions. The process doesn't really end. It has to be redone after any new information comes to market.

halvening is not new information, so basically irrelevant for price discovery.

This won't affect the price of GPU cards heavily right? Since most of the mining is done by specialized ASIC boxes now?

Bitcoin rising in value tends to pull up many altcoins along with it, including GPU mineable ones like Ethereum, Monero and Grin.

Demand for bitcoin comes from ransoms. Entire cities are being extorted so this affects the price.

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